• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Port Info

• Ships in Ports
  
  

Archives

• Yesterday
• Datewise
• Resources

Group Sites

• The Hindu
• Business Line
• The Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

C. Shivkumar

Bangalore , Oct. 2

THE public sector Power Grid Corporation of India Ltd (PGCIL) has begun generating revenues from its telecom operations in the southern region.

Sources said this year PGCIL has earned about Rs 20 crore as lease rentals for its optic fibre cable network. PGCIL provides the OFC backbone to telecom service providers (TSP) and cable television service providers.

The sources said the largest users of the backbone were Bharat Sanchar Nigam Ltd and Reliance Infocomm, which supplement their own backbone capacity with leased network.

The sources said most of the leases were worked out on an annual renewal basis. Only in the case of some users, PGCIL had entered into long-term leases for up to three years. But most players preferred one-year tenures with a renewable option, the sources added.

The preference for shorter tenures was on account of a possible increase in the availability of backbone capacity from other sources including the Indian Railways. Once additional capacity was available, the sources said, rentals were expected to drop.

But the sources said demand from TSPs was likely to rise and push up lease rental revenues for PGCIL. In fact, discussions were already underway with more service providers for lease of telecom infrastructure, the sources added.

PGCIL has a national OFC network equivalent to 19,000 kilometres. In the southern region alone, PGCIL's backbone links 20 cities.

The sources said the advantage with the PGCIL network was remote area connectivity. This allowed TSPs to expand their network into hitherto unconnected regions without making expensive investments on infrastructure, the sources added.

In fact, the private TSPs and television channels were able to reach out to these remote towns and villages largely through the PGCIL network, they added. Besides, this backbone had also allowed for Internet access from rural regions of the country.

PGCIL's network was originally built for its own captive user. However, the surplus capacity available was leased out to other corporates.

Consequently, this generated additional revenues for PGCIL. This is in line with global trends, where power transmission companies also earn large revenues through backbone leasing service providers.

PGCIL's telecom infrastructure lease operations are estimated to generate surpluses in excess of Rs 300 crore over a five-year period.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
GEM India picks up stake in Sula Vineyards

Copyright © 2005, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line